In one word, ABSOLUTELY.
I was at a sales conference not too long ago in San Antonio Texas. The schedule for the conference was jam-packed but allowed some free time the first day for conference goers to explore the city. With the purchase of the conference ticket, everyone got a free pass for a guided tour around the city. Of course I was too good for that. With internet access in my hotel room and my laptop at the ready, I did a quick search to plan my own tour. I quickly created an itinerary , synced up my handheld and off I went. It turns out due to the size of the conference (plus the regular population of San Antonio), every cab in the city was being used. It didn’t stop there, buses, scooter rentals, everything was tied up. By the time I finally got a cab, I was afraid to get out, fearing that I wouldn’t get another one. Long story short, I did most of my sight-seeing that day from the inside of a smelly cab. When I got back to the conference center that night for the meet and greet, everyone was talking about how great the FREE guided tour was and the amount of inside knowledge on the history, culture and happenings of the city they had learned that day. I know now it is always wiser to stick with a pro.
The same could be said about real estate agents. Although real estate agents are often considered to be someone who just drives buyers around, the role of an agent is much much more. Real estate agents are a great resource for home buyers relocating from outside the community. Real estate agents know the area including home values, utility costs, school data and taxes and may even may be helpful with information about special interests or specific needs of home buyers. For instance, should you require help relocating an elderly parent with you, a good real estate agent may be able to direct you to local services or organizations for the aging. In addition, a sales professional can familiarize you with the procedures involved in the purchase of a home, warn you of possible risks, help you decide on how much house you can afford as well as explain some alternative financing programs.
Besides providing moral support, another benefit to having a strong advocate is having help throughout negotiations. Sales professionals can assist buyers in objectively creating the offer then negotiate a suitable contract with the seller. Throughout the process, a sales professional (with the help of an attorney) will review the contract and responsibilities, explain how contingencies and release clauses work and many other things outlined in a contract.
There is a great peace of mind in having a sales professional manage the entire transaction from start to finish including inspections, managing the paperwork, staying on top of deadlines and contingencies, estimating closing costs, and help to make for a smooth and easy closing.
If you’re considering buying or selling a home, think about italking to a real estate professional first. When making a decision of this magnitude it is best to have a seasoned real estate professional in your corner.
Lou Lynch – Director of Technology for Prudential Nutshell Realty
Providing stellar Ulster County real estate services for home buyers and sellers in Upstate New York.
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Great post Lou!
Spencer from Zillow here. I agree.
Real estate will (and should) always be a professionally-assisted transaction. This is the biggest financial transaction of most people’s lives, and they should have an expert by their side. They should seek as much information as possible (on sites like Zillow and elsewhere), but they should still work with a professional.
Our clients rely on us to help them with so much more than just to let them into houses. The agent really helps coordinate the entire process. One of my lender partners likes to think of the agent as a pilot flying the plane, the agent is the one that keeps the transaction moving as smoothly as possible.
Great post Lou. I totally agree with you. Especially in this tough, ever changing market, how can you not hire a real estate professional.
The internet is a great tool for helping buyers and sellers become more savvy about today’s market. My main point is that the web should never be considered a substitute for a well qualified sales person who knows the area and the business inside out.
All great comments.
Yes, real estate professional rally required as they know what exactly you are looking for and can guide you to the best home which you can not decide online.
It is too bad that many people think Zillow (no offense Spencer) or a county tax appraisal district provide accurate information about the market value of a home. This simply isn’t the case in a non-disclosure state like Texas. The ONLY way to get good comparables to determine market value is through the MLS and you need a licensed agent for that.
Lou – Besides lacking knowledge of a market some people just don’t think they need a realtor to even visit homes. I got a call the other day from a user on our real estate website. He asked to see a home for sale but since it wasn’t our listing we told him we would have to work as his buyer rep to show the home. He quickly informed me that he wasn’t using a buyer rep and didn’t want to use one. When I asked how he planned to tour homes, he told me he generally just walks around the perimeter of vacant homes and looks in the windows. I was speechless for a second and ended up telling him that wasn’t a safe way to visit homes and I couldn’t help him any further.
Sam – I agree 100% and had to respond to customers using these sources numerous times.
Michael – That is insane. Our listing agreements states that the property is only to be shown to buyers accompanied by a licensed real estate agent. There is a lot of potential liability for the guy who is walking around vacant homes.
The liability potential is astounding. There have been cases here (and elsewhere I’m sure) where squatters have attacked people looking at “vacant” homes.
Eric – We sell real estate in Hawaii and almost all buyers are using the internet for their initial research for home prices are researching areas. We find that as soon as they are ready they are seeking the help of a professional. They are not using the internet the purpose of doing it themselves. Buyer still like working with real estate agents because of their knowledge of the area and real estate law.
Yes I agree the internet does help people educate themselves but it doesnt do it for them and every situation is so different that its hard to have the internet come up with the answer. In addition some areas are “feel” areas like negotiations, and which home is really a better home where a good agent will be able to excel the internet can never replace that.
I do agree that real estate agents are an important part of the house buying process as they are likely to know the best neighborhood to suit you, however I feel that it is also important for buyers to do their own research into local prices, organize their own building inspections and to consult an attorney when it comes to the purchase agreement. This way the buyer is safe guarding themselves and will be confident that the purchase is the right one for them. Thank you for the article.
Most Definately! I almost purchased a property recently that had at one time been a gas station. Had the Real Estate Professional not insisted I get a Phase1 (something to do with environmental hazards) I’d be up to my eyeballs in a mess.
You wouldn’t let an amateur brain surgeon loose on your cranium… though you might as well if you think you can do real estate without a professional…
Many times buying real estate is an emotional roller coaster – especially when working with first time home buyers. Had I not been around to help guide my recent couple through the ups and downs, I am sure they would not be in their new home today.
I have been in sales for about 25 years now and it always seems like some new technology will be making us obsolete. But of course as we all know, no technology can replace personal service and relationships (but I am sure someone is working on it).
I agree, they need a agent more then ever before.
I just have to say one thing, most of the mess with the market is due to the lack of diligence agents failed to complete. Most of the bad loans come from newer built homes. I am not an agent but i knew buying into a newer neighborhood is risky, since the newer homes don’t have a background.
In my area, you have the mayor threatening to bulldoze a few neighborhoods 4-7 years old. Not so good. Agents main concern imo is to make a commission. Once the hood goes bad, the same agent is there to try an help sell the house usually through a short sale.
That’s not my idea of a having a trusted professional on your team. They are the last line of defense to protect buyers, but did little to help.
I might be wrong but i would like to hear different opinions about this.
I think you’re making a broad generalization about a profession based on the actions of a small minority in that profession.
Yes, great post Lou. When reading your post the thoughts of you get what you pay for constantly came to mind. In this case though you paid for it but then refused to use it, kind of like some of the home buyers who think that somehow they can work a better deal if they go to the listing agent to write their offer for a home. I can say without any hesitation that in some cases the home seller might possibly be getting a better deal, and the listing REALTOR is getting a much better deal, but the buyer is getting the shaft.
Keep up the great writing.
Jim
Thanks James – Good to see you over here. It is great being able to contribute to such an insightful community.
In response to the comment two comments above “Sell my house”. I am not 100% clear on what you are trying to say. Do you have some personal experience or information on a bad builder? And exactly how does that relate to the problems with our current mortgage market?
We as REALTORS can make assumptions about what a homeowner can afford or the structural quality of a home but for the most part we allow attorneys, mortgage professionals and home inspectors advise our clients on how to proceed. I am not saying we hold no responsibility but in your scenario, there is no way the REALTOR him/herself can be to blame. There is just so much due diligence that can be done. Lastly, I can’t see how on earth you can use that experience to make a statement about the industry as a whole.
Wow, I know this might be hearsay, but when I look for our next home I will be much more likely to go it alone or only pay for the services I actually use. Realtors do help first time buyers. However, once you’ve been through the process, the realtor is pretty much the key holder (to see homes and in nondisclosure states like TX to comps) only.
Realtors are helpful, but really only because they are ingrained in the system and its difficult to get the system to respond without a Realtor.
I agree the Internet doesn’t do away with the need for a real estate agent. The Internet can’t protect you from over paying a zealous homeowner or making sure that everything is on the up and up. What the Internet does do is make homebuyers more educated and savy on what is going on in the market. It also helps them to find homes that may be of interest, saving the realtor a bit of leg work.
Can you imagine if buyers and sellers had to deal direct with each other on every transaction? Almost every deal would fall apart, especially in this type of market where emotions are very high and every buyer feels like they have the right to steal every house. Having someone negotiate the deal is priceless.
The internet can be a great resource to find a lot of information. But I think it’s always better to have personal contact with a real estate agent. They can best analyze your situation and find suitable solutions.
Eric, I hate to make a broad statement but Realtors are the first and last line of protection for homeowners looking to buy a home. In Charlotte, NC most of the homes that are going into foreclosure are homes less than 8 years old.
These homes are cheap designs and realtors knew that older homes weren’t selling for the price the new homes are selling for and most of the older homes are brick. None of the newer homes are brick on a curtain with brick, which is not the same.
Agents were looking for a quick buck and hoped that the newer homes would hold up to the value test. They didn’t and now the Charlotte market is suffering like all other markets across the country,.
It’s not fair to blame Realtors for over-inflated prices. All of this hysteria was fueled by foreign credit into the United States that was then leveraged many times over. THAT, my friends, is the reason the real estate market is dragging the economy down. This surge of money CREATED the demand for the creation of mortgages. As a result, lenders lowered standards and the frenzy began. When you offer people with bad credit a house with no money down, you are going to have problems. Trust me, the percentage of loss from foreclosures as a result of bad lending policies are MUCH greater than the amount of “artificial equity” created by Realtors not reigning people in. Plus, it’s not a Realtor’s job to restrain the market–only to show values based on comps. Buyers and seller determine a market. It’s been like this since the beginning of time.
Thanks,
Grant
To make sure I’m staying on topic, I’d say that part of Realtors’ real value is their study of local, state, and national economics and advising people based on their professional knowledge. As for those that continue to blame Realtors for all our economic woes, this link explains the entire root the cause. It will blow you away. Listen to the audio.
http://www.thislife.org/Radio_Episode.aspx?episode=355
I for one am glad to see that buyers have more access to information on homes for sale. I never liked the mafia approach to real estate where agents would only share this information when under buyer rep. agreements. This new way of business just keep agents on their toes and makes them learn their market better.